Donovan Singapore Property Market Composite Index: 6 October 2012, Saturday, 4.22pm
The chart attached is a Composite Index of the Singapore Property Market, comprising of the truest litmus reflections of the local property market. The Donovan created Donovan Singapore Property Market Composite Index consists of the blue chips, large caps, mid caps and small caps (CityDev, Capitaland, Keppeland, SC Global, UOL, Wing Tai, Ho Bee, Hong Fok, Roxy-Pacific) that are reflective of and active in the Singapore property market. For ease of reference and comparison with respect to the Straits Times Index, all values of the Singapore Property Market Composite Index will be given x100 to derive with a 4-digit index.
The first warnings by the market were given the salvo during June, July and August 2011 (last year) with the breaking down of the Singapore Property Market Composite Index at near 2600 points (corresponding with $26 above).
The August 2011 nasty market plunges were, beforehand, given severe pre-warnings by me in June and July last year 2011 (refer: http://www.youtube.com/watch?v=QroFRLSf16I and
http://www.youtube.com/watch?v=T8pfhkQAiA4&feature=relmfu ), during which in the final week of July 2011 when everyone was bullish, I had warned severely that Big Hands were going to plunge the market in the 1st week of August based on Donovan Funds Flow Analysis Calculations. True enough, the plunge came, and alas, Technical damage was achieved as a first stage operation.
With mass bearishness in the market at the end of 2011, in which the masses are always supposed to be wrong, from December 2011, the market achieved the A-B-C big wave Mid Term Technical Rebound, throwing confusion to the masses who were once again wrong on their bearishness.
With the introduction of QE3, the masses are to be wrong yet again with their bullishness. This is because the QE3 (or QEfinity) had already been absorbed by the markets and baked into the prices way beforehand. This had already been absorbed by the entire duration of 2012 leading to the announcement; market had already priced in QE3 way before it was released.
This time round, Market made use of these final few weeks to make its last (limited movement up) backtest of Bear Market Lines (R1, R2 and R3 above). Worse, R4 Mid Term BLACK RESISTANCE LINE was also satisfied. To make all things worse, that is worst of the worse, Price Sastisfaction Target was also achieved concurrently at 2998 points (corresponding with $29.98). This would make it the R5. Concurrently, all R1-R5 are triggered for sell-downs.
This time round, Market made use of these final few weeks to make its last (limited movement up) backtest of Bear Market Lines (R1, R2 and R3 above). Worse, R4 Mid Term BLACK RESISTANCE LINE was also satisfied. To make all things worse, that is worst of the worse, Price Sastisfaction Target was also achieved concurrently at 2998 points (corresponding with $29.98). This would make it the R5. Concurrently, all R1-R5 are triggered for sell-downs.
The market is merely awaiting for the price satisfaction triangle to break down as above charted Technical Analysis shows (Thinner BLUE SUPPORT LINE). The GREY SUPPORT LINE is the first target. There is no time frame for achieving that. However, if the movement to GREY SUPPORT is impulsive, there is a likelihood that GREY SUPPORT would not hold, and if it does not hold, it means the property market is resuming, officially, the next stage of its nascent bear market based on my Technical Analysis.
Only a re-capture of YELLOW R1, ORANGE R2 AND RED R3 will negate the Singapore Property Market Composite Index Nascent Bear Market. There is extremely low likelihood of re-capturing the resistances because R1, R2, R3, R4 and R5 are very high sell pressure points. The distribution was high volume and rebound was far below par in comparison. This shows that there are plenty of small fishes and mid sized fishes holding unwanted babies that the Big Hands disposed of. In addition, Big Hands were piling up stocks shorts as mentioned last few weeks.
Based on charted Technical Analysis above (refer chart above), all late comers will have to be careful against getting hurt in the property market as well as property stocks. QE3 merely did the market backtests in Gold (previously highlighted) as well as the backtests in Donovan Singapore Property Market Composite Index.
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